Provincial Electrification Required To Cut Energy Prices

Poor Cambodians living in the provinces are now paying about three times the rate charged city-dwellers for electricity, an Asian Development Bank-commissioned survey found.

People surveyed in 15 provinces where only small-scale private power supplies are available spend on average a little more than $0.30 per kilowatt-hour, Victor Jona, chief of the provincial electricity office at the Ministry of Industry, Mines and Energy, said at a provincial electrification workshop Thursday.

But in the poorest provinces, electricity can cost much more—as high as $0.46 per kilowatt-hour in Stung Treng and $0.43 in Mondolkiri, Jona reported.

Most of those surveyed spend at least 10 percent of their monthly income on electricity, Jona said.

The state-run Electricite du Cambodge is operating in only seven provinces and the greater Phnom Penh area at an average price $0.15 per kilowatt-hour.

Victor Jona told international experts and workshop participants from the country’s power sector that monthly power consumption varies province to province, depending on socio-economic status.

In Pursat, the poor consume only 5-25 kilowatts per month while the rich use 150-300 kilowatts a month. In Mondolkiri, poor people buy less than 5 kilowatts while the wealthy use up to 30 kilowatts, he reported.

According to the survey, Jona said, people consider $0.16 per kilowatt-hour for household use affordable, while $0.14 for commercial use and $0.12 for industry consumption is acceptable. But such prices are available only in Phnom Penh and urban areas.

The ADB, which organized the workshop, has approved an $18 million loan for the provincial town electrification project.

With this project, eight provincial towns in Kompong Speu, Takeo, Kampot, Prey Veng, Svay Rieng, Stung Treng, Mondolkiri and Ratanakkiri will have reliable energy supplies and distribution in three years.

Experts say increasing access to energy and reducing provincial electricity prices are key to poverty reduction in Cambodia, where more than 36 percent of provincial population lives under the poverty line. Just 7 percent of rural residents have access to a reliable power supply.

ADB Consultant Clive Hughes said the provincial town electrification project could significantly reduce energy prices. For example, he said if Svay Rieng is connected to the Vietnam’s electricity transmission line, rates could potentially drop to $0.06 per kilowatt-hour during off peak hours and $0.12 in peak hours.

“Grid connection could bring prices down, especially at night,” he said, adding that lower prices could contribute to cheaper agricultural pumping and irrigation. “It would support big economic development in provinces.”

Hughes said that energy consumption is very sensitive to price, explaining that cheaper prices encourage heavier use.

He said, for example, people in Poipet and Phnom Penh, where energy prices are about $0.15 per kilowatt-hour, consume nearly 300 kilowatt-hours per month—20 times the average consumption in Stung Treng.

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